It’s one of the hottest trends in crypto. Bitcoin, and I’m looking to increase my holdings.
President Donald Trump’s media organization has just announced a plan to raise $2.5 billion to invest in Bitcoin, aligning with the so-called “Bitcoin finance company” as the world’s leading cryptocurrency reaches all-time highs.
Companies invest in Bitcoin for various reasons. While some view it as a hedge against inflation or a show of support for the crypto industry, others employ debt and stock sales to drive their major business strategies into Bitcoin.
“The entire world is still unaware of what’s unfolding, and they’re anticipating a significant shock,” stated Dylan Leclair, an executive at Japan-based Metaplanet, who transitioned from a budget hotel firm to a Bitcoin Treasury company, during a recent crypto conference. “This is an unstoppable force, and nothing can hold it back.”
While the sharp increase in stock prices for some companies may seem to affirm Leclair’s confidence, numerous warnings indicate that a downturn in Bitcoin values could prompt substantial selling.
Let’s explore the numbers behind Bitcoin finance companies.
582,000
This is the number of bitcoins owned by MicroStrategy, which stands as a titan in the realm of Bitcoin finance companies.
Holding nearly 3% of the total Bitcoin supply, MicroStrategy possesses more Bitcoin than all other Bitcoin Treasury companies combined. They have also amassed more Bitcoin than all national governments collectively, according to the tracking website BitcoinTreasuries.net.
Formerly known as a software company, Strategy began accumulating Bitcoin in 2020 with surplus capital. Today, its software division constitutes a minor part of a continuous Bitcoin acquisition engine that utilizes various strategies, including stock sales and issuing debt, to maintain its Bitcoin holdings.
Over 3000%
This represents the increase in MicroStrategy’s stock prices over the last five years, alongside a rise of approximately 1,000% in Bitcoin’s value and a 1,500% surge in chipmaker Nvidia’s stock during the same timeframe.
The company’s achievements have elevated Michael Saylor, MicroStrategy’s founder and chairman, into the spotlight.
“Bitcoin is a swarm of cyberhornets honoring the Goddess of Wisdom, fueling the essence of truth, expanding exponentially behind a fortress of encrypted energy, and getting faster and stronger,” Saylor conveyed through social media. post.
Saylor’s success has also led to numerous imitators.
“It’s quite astonishing. It feels like a trigger was pulled after four years since Michael Saylor took the lead,” remarked Eric Semler, chairman of Semler Scientific, a healthcare firm that began acquiring Bitcoin last year.
$90,000
A recent study by Standard Chartered reveals that this is the average purchase price of Bitcoin for half of the 61 listed Bitcoin strategy companies, excluding Bitcoin mining firms and Bitcoin exchange-traded funds.
According to Jeff Kendrick, the bank’s head of digital assets research, the restrictions on investors purchasing Bitcoin help explain the rise of Bitcoin finance companies. However, as cryptocurrency becomes more mainstream, Kendrick noted that the investment landscape for Bitcoin finance companies may weaken.
He also indicated that Bitcoin’s volatility might compel some new Bitcoin finance firms to liquidate their holdings to fulfill their obligations if purchase prices decline.
“The question is, how much pain can a company endure before it must sell BTC?” Kendrick pondered, referring to the Bitcoin symbol.
Triple numbers
This is the increase in daily rates seen by companies that recently announced plans to diversify into other cryptocurrencies as part of their corporate finances, underscoring their appetite beyond Bitcoin.
Gambling marketing firm Sharplink Gaming has disclosed that its stock price has surged by over 400% following its announcement to acquire up to $425 million in Ethereum. Additionally, crypto company Upexi confirmed a stock price increase of more than 300% after revealing plans to invest $100 million in Solana, a popular cryptocurrency within the Meme Coin ecosystem.
Source: apnews.com